We Cannot Wait Until 2012.

U.S. News:

The Ranks of the Underemployed Continue to Grow
In September, the number of underemployed workers rose for the third consecutive month
By Ben Baden

While the number of unemployed workers has held steady at around 14 million in recent months, another telling measure of frustration in the labor market—the number of underemployed individuals—rose for a third consecutive month in September, by almost a half of a million people.

Almost 9.3 million Americans are considered underemployed, defined by the Bureau of Labor Statistics as working part-time for economic reasons, such as unfavorable business conditions or seasonal declines in demand. That's up from just over 8 million in July, but down from a peak of about 9.5 million in September 2010. In addition, about 2.5 million individuals are considered "marginally attached to the labor force," meaning they were not in the labor force, wanted and were available for work, and looked for a job sometime in the prior 12 months. (They are not counted as unemployed because they had not looked for a job in the past four weeks prior to the survey.)

Put together, almost 26 million Americans are either unemployed, marginally attached to the labor force, or involuntarily working part-time—a number experts say is unprecedented.

"The labor force is substantially underutilized relative to what we experienced in most of the post-World War II period," says Patrick O'Keefe, director of economic research at accounting firm J.H. Cohn and former deputy assistant secretary in the U.S. Department of Labor.

From 2003 to 2007, before the latest recession, O'Keefe says the number of people working part-time for economic reasons as a percent of the labor force averaged about 3 percent, or approximately four million people. Over the past 12 months, the average has been about 6 percent.

To get a more accurate understanding of the struggles that many Americans face, that base should be broadened even further, says Paul Osterman, co-author of Good Jobs America: Making Work Better for Everyone. He says it's important to consider people who are working, but at substandard wages. According to Osterman, about 20 percent of adults have jobs that pay poverty-level wages (the poverty line is currently $22,500 a year). "I'd consider that to be another version of underemployment—mainly jobs that are just too low-quality," says Osterman, who is also co-director of the MIT Sloan Institute for Work and Employment Research. Americans who fall below the poverty line make less than $10.50 an hour.

"The labor market is just not delivering for Americans what it should be delivering," Osterman says. "The weaknesses are on multiple dimensions—one is just the quantity of jobs, and the other is the quality of jobs that do exist."

Economists say the high number of underemployed workers is a sign of the tough economic times. "One of the things that seems to be happening these days is that companies in an uncertain environment are tending to take people on part-time instead of full-time because they don't want to make that full-time commitment," says Dennis Jacobe, chief economist at polling firm Gallup. By taking on part-time employees instead of full-timers, companies aren't forced to pay benefits or bring on employees for extended periods of time. It's also a lot more difficult to let full-time workers go, Jacobe adds.

That's left millions of Americans trying to make ends meet by working multiple part-time jobs. "There are a lot of people today who are self-employed, and they go through periods of their life where they're cobbling together various jobs or projects or consulting assignments or temporary work," says John Challenger, chief executive officer of outplacement firm Challenger, Gray & Christmas.

Ted Schnell of Elgin, Ill., is one of those people. For the first time in his 27 years as a journalist, the now 52-year-old father of five found himself unemployed in December 2010 after being laid off by Sun-Times Media. Since January, he's worked part-time for a former colleague who started a local news site. Schnell has written about his experiences on his blog Laid off at 51: Seeking joy in change.

For a few weeks earlier this year, Schnell was able to land two copyediting jobs at two regional Patch.com sites, but AOL, which owns Patch, slashed its freelance budget soon after and he lost one of those positions. "It's miserable in terms of what I'm making," Schnell says. In addition, he says he's stuck in a house that's worth substantially less than his mortgage, and he's had to ask his father to help with payments. Schnell, like many older underemployed Americans, says he's worried that he may get passed over by potential employers because of his age. He remains discouraged. "For every 50 to 100 resumes I send out, I may get one interview," he says.

CNBC:

Jobless Claims Straddle Key Level; Big Upturn Still Elusive

Applications for unemployment benefits have fallen to a six-month low, according to a four-week averaged calculated by the government.

Some economists said the steady decline signals fewer layoffs and possibly stronger job growth in the months ahead. But they cautioned that employers are not yet hiring at healthy levels.

Weekly applications dropped by 6,000 to a seasonally adjusted 403,000, the Labor Department said Thursday. The four-week average fell for the fourth straight week to 403,000. A month ago it was 422,250.

"This decline in initial claims signals the potential for an improvement in the pace of job creation in October relative to recent months," said John Ryding, an economist with RDQ Economics. "However, we are still waiting for that decisive move in claims below the 400,000 mark to send a stronger signal that payroll growth is running at a pace that will begin to make sustained inroads into unemployment."

Many economists say applications need to fall consistently below 375,000 to signal sustainable job growth. They haven't been below that level since February.

Economists have been closely watching unemployment benefit applications since fears of another recession intensified this summer. Layoffs and applications tend to rise at the beginning of recessions.

Employers have added an average of only 72,000 jobs per month in the past five months. That's far below the 100,000 per month needed to keep up with population growth. And it's down from an average of 180,000 in the first four months of this year.

In September, employers added only 103,000 jobs last month, and the unemployment rate remained 9.1 percent for a third straight month.

Employers pulled back on hiring this spring, after rising gas prices cut into consumer spending and Japan's March 11 earthquake disrupted supply chains. That slowed U.S. auto production.

Auto output has rebounded in the past couple of months and gas prices have come down from their peak in early May. In September, consumers increased their spending on retail goods by the most in seven months.

Those trends likely boosted growth in the July-September quarter to about 2.5 percent, economists predict. That's an improvement from the 0.9 percent annual rate in the first six months of this year. But it's not enough to spur much job growth.

The number of people receiving unemployment benefits rose 25,000 to 3.7 million. But that doesn't include several million additional laid-off workers receiving extended benefits under an emergency program paid for by the federal government and put in place during the recession.

All told, 6.7 million people received benefits in the week ended Oct. 1, the latest data available.